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Re: Tax cuts or balance budget

GDP & Tax, on average, has a history of increasing year to year no matter what the tax policy is. Why is Bush's tax policy special when it likely would have happened anyway?

Just because an account increases, it doesn't mean it's also NOT experiencing a loss... Its crucial to analyze the information in ratios; compare previous years to this year, compare growth ratios, compare revenue growth/loss ratios each year. Do not simply look at the numbers and compare them. I am not saying this is what people are doing, but I have seen many people post numbers on these forums and try to make an argument, and it's not a good argument.

Re: Tax cuts or balance budget

I lean Conservative and I'll answer: You have to do both at the same time. Spending is way out of control. It needs to be be reduced and reduced drastically. I would use the FY 2008 budget as a base line and make reduction from there. Taxes, especially business taxes are way too high. They need to come down and come down fast. Remember Government does not create jobs, private businesses do. I say get the government out of the way and turn the genius of the American business loose.

Originally Posted by Kandahar

Good luck getting a straight answer from any conservatives here. I've asked this question before, and most of them resent the whole premise of government paying for the services it provides.

I came into this world fighting, screaming and covered in someone else's blood. I have no problem going out the same way.

Re: Tax cuts or balance budget

If people have to pay fewer taxes it can spur them to invest more and be more productive.

Why didn't it, then? Why did they continue to outsource and not re-invest in America if that is the case?

Originally Posted by sazerac

Our tax revenues increased as a result of the tax cuts. 2004 brought in more than 2003. 2005 more than 2004. We spent a whole lot of money on wars which added to our deficit. Our tax revenues are really up to our economy more than anything.

These two statement are contradictory. First you attribute it to the tax cuts then say it has more to do with the economy than anything. Which is it?

I personally don't see any evidence that Bush's tax cuts did anything you claim, in theory or in reality.

Our economy didn't really "grow" either, we didn't begin producing more. If anything speculation increased tremendously during that period, not actual growth. GDP is a poor reflection of economic reality in my opinion, especially in America. How can 70% of an economy be based on consumption? If people increase consumption, which therefore "grows" the economy, how is that a good thing?

Re: Tax cuts or balance budget

Originally Posted by sazerac

As bad as our politicians are, at least we have a law that they must balance the budget.I have no doubt that we would owe many trillions of dollars otherwise.

The problem with that it is impossible to highly undesirable to balance a budget in a recession. In a recession, revenues fall dramatically (almost $.5T in this recession), while cutting expenditures in a recession does nothing to help, and in fact further slows the economy.

Re: Tax cuts or balance budget

I haven't read the rest of this thread, but I'd take a different option.

I favor more efficient government spending.

We can't have tax cuts because the government needs revenue to operate. It just does. It needs to do it for the military, for transportation infrastructure, for the regulation of safe commerce, for public education, and for law enforcement.

However, demanding a balanced budget is pretty pie-in-the-sky. Our government operating via debt is the norm. And people invest in our national debt because our government is an extremely stable entity for investment. On the other hand, that's not the same as operating on a deficit, and the larger our deficit is the more we will have to pay back our national debt.

So what we need to do is use our debt more selectively and efficiently. And we need to start spending on government programs that wil increase the economy. One way to do this is to do less military spending and instead use that money to increase and maintain our transportation infrastructure. This is important because our economy depends on commerce and commerce depends on transportation routes for goods and services to flow. I also heard that every $1 spent on transportation infrastructure gives us a return of $1.50.

So while we definitely need to bring government spending under control, we also need to focus that government spending on things that will increase our economy. Instead of looking at it as government spending it should instead be looked at as government investments and we should invest in those things that will give the people of the U.S. a return on those investments.

Re: Tax cuts or balance budget

Why didn't it, then? Why did they continue to outsource and not re-invest in America if that is the case?

These two statement are contradictory. First you attribute it to the tax cuts then say it has more to do with the economy than anything. Which is it?

I personally don't see any evidence that Bush's tax cuts did anything you claim, in theory or in reality.

Our economy didn't really "grow" either, we didn't begin producing more. If anything speculation increased tremendously during that period, not actual growth. GDP is a poor reflection of economic reality in my opinion, especially in America. How can 70% of an economy be based on consumption? If people increase consumption, which therefore "grows" the economy, how is that a good thing?

We did see an increase in total revenue after the tax cuts. It's just a fact. It didn't mean the economy would go gangbusters or that we would't go to war or that businesses would stop outsourcing.